Or “how to use Network Science to advance strategic goals”. Sorry, but that wouldn’t make as catchy a title as the mention of Kevin Bacon, would it? But read on and you will see how Kevin Bacon could have smart lessons for business.
Let’s deal with Network Science first. Network Science is the study of networks – social, physical, biological and other kinds – to identify patterns, principles and possible algorithms in their interaction. It can help answer questions about how information is shared, how diseases may spread, how immigrants choose where to live, who knows whom and so on. Such understanding can help build predictive models of network behaviour. For instance, scientists have developed successful models to predict the spread of a disease. Such a predictive model can help focus preventive and curative resources to contain the spread of disease. The applications are numerous and varied.
Understanding the patterns, dynamics, principles and algorithms in social, biological and information networks can help businesses become smarter.
If businesses understand the whole context in which they operate, identify the links between seemingly unconnected factors and utilise the information about their networks sensibly, they could do things more efficiently and effectively. Here are some ways how.
Define problems better
Here is a real investment decision situation I saw many years ago. An investor received a business plan seeking funding to roll out high speed web access on high speed trains. Much time was spent discussing their customer contracts etc. When my opinion was sought, belatedly, I asked about the design and installation of antennae, the stage of manufacturing when the locos were being wired, and the relationship between the antennae design and supply company and the investment proposal in front of us. Needless to say, involving me – who is an electronics engineer and spent a summer working in an Indian electric locomotive manufacturing facility supplying a European mega-brand – helped the investors redefine the investment proposition and change the conversation to their advantage.
Evaluate and allocate resources smartly
Close observation makes it clear that some start-ups are more likely to last than others. Amongst others, their ability to allocate their limited resources smartly makes a difference. If you are a software product or biomedical device company, with 4-5 employees, would you rather spend your time sitting indoors tinkering with your product to make it perfect or would you rather get it out in front of a sympathetic yet knowledgeable group of people who can help you get to the next stage – whether prototyping or mass manufacturing or something else? Knowing who in their network can help maximise the return on your scarcest resource – executive time and time to market – would give a start-up a considerable advantage.
Find and hire better employees, cheaper
Several consulting firms actively encourage their staff, with cash or non-cash incentives, to recommend potential employees for open positions. It helps them target a latent market of individuals who are not actively seeking a change, whose being employed is a signal of their employability; they can save costs by bypassing the need to advertise the open jobs. After all, an alleged 70-80% of jobs are never advertised. A new employee comes with an implicit recommendation of an existing one. The risk, that you end up hiring too many similar people, can be mitigated by being selective about the sort of linkages that are valuable to you.
Work your network. A network is as good as its connections, their dynamics and how they can help define and solve problems better.
Solve problems cleverly
Awareness of network dynamics can help generate innovative solutions to sticky problems. One such problem was the non-availability of credit to the unbanked people, the financially excluded and those whose poor creditworthiness meant large lenders are not interested in them. Nearly 41% of India’s population is unbanked, while estimates in the USA stand between 9-13% (pdf link).
Peer-to-peer lending emerged when willing lenders could connect with such borrowers via the web, utilising its global nature.There are now several P2P lending companies that make cash available to micro-entrepreneurs, students and other borrowers. Some others provide verification services to both parties involved. Creative solution to a real problem.
So, what does this have to do with Kevin Bacon?
Well he lends his name, to a social experiment called Six Degrees of Kevin Bacon. The premise is that nearly everyone is connected to Kevin Bacon, the entertainer, with 6 or fewer links in between. For the record, I am two persons removed from Kevin Bacon on LinkedIn. If I were keen to learn to dance like him in Footloose, I would work my network.
The question is: are you working your network to get closer to your goals?
A short repository of links on Network Science on MIT’s website
Chris Brogan asks Will Companies Value Your Personal Network? The smart ones already do.